Amazon agrees $2.5bn settlement for allegedly duping customers into Prime membership

Core Viewpoint - Amazon has reached a $2.5 billion settlement with the Federal Trade Commission (FTC) over allegations of misleading customers into signing up for Prime membership and complicating the cancellation process [1][5]. Group 1: Settlement Details - The settlement includes $1 billion in civil penalties and $1.5 billion to be refunded to customers who were unintentionally enrolled in Prime or faced difficulties in canceling their subscriptions [2]. - Approximately 35 million Prime customers are eligible for payouts from the $1.5 billion fund, with those who signed up between June 23, 2019, and June 23, 2025, receiving $51 each if they used few Prime benefits [2]. Group 2: Allegations Against Amazon - The FTC accused Amazon of making it intentionally difficult for customers to purchase items without subscribing to Prime, with unclear transaction completion buttons that enrolled customers into Prime [3]. - The cancellation process was described as overly complicated, requiring customers to affirm their desire to unsubscribe on three separate pages, internally referred to as "Iliad" [4]. Group 3: Company Response - Amazon did not admit any wrongdoing but opted for a quick resolution to avoid a lengthy trial, stating confidence in winning the case [5]. - The company emphasized its commitment to transparency in subscription terms and is now prohibited from misrepresenting subscription details, requiring clear disclosure of costs and obtaining express consent from customers [7][8].